Donald Trump ends negotiations with Trump Taj Mahal bondholders to take on more of his debt so he can avoid bankruptcy. In a statement about ending the talks, Trump blames Wilbur Ross — his future Commerce secretary who’s currently representing the bondholders.
According to Trump, the bondholders want to work with him, but Ross is standing in the way.
“We saw no point in going forward,” Mr. Trump said in the statement. “Unfortunately, this case will be in court for many years to come. Numerous individual bondholders have called us wanting to deal directly with us, but we are unable to make a deal with Mr. Ross and his group.”The New York Times – Nov. 14, 1990
Ross calls the announcement a publicity stunt and reiterates earlier statements that bondholders will benefit more financially from the Taj Mahal’s bankruptcy than from additional bonds. Bondholders hold a first mortgage on the casino and would likely take control of the business in bankruptcy court.
Trump has two days to make a $47.3 million interest payment on his Taj Mahal debt, then he has a 30-day grace period to avoid certain bankruptcy. His lawyers have already prepared bankruptcy papers, just in case.
The failed dealmaker reopens negotiations with Ross and his firm the next day, providing fuel to claims that today’s events are a publicity stunt.
NYT – Bankruptcy Papers (Archived)
NYT- Trump Statement (Archived)
NYT – Negotiations Continue (Archived)
Photo: Ron Galella